Tim Geithner on the U.S. Debt Rating in February 2010
As the decibel level of the default and debt-rating debate dials up to deafening levels, let's recall what Tim Geithner said about our Aaa rating once upon a time.
According to a Bloomberg.com article dated February 10, 2010,
Treasury Secretary Timothy F. Geithner said the U.S. is in no danger of losing its Aaa debt rating even though the Obama administration has predicted a $1.6 trillion budget deficit in 2010.
"Absolutely not," Geithner said, when asked in an ABC News interview broadcast yesterday whether a downgrade is a concern. "That will never happen to this country."
Geithner said investors around the world turn to U.S. Treasury securities and dollar-denominated assets whenever they are worried about global stability. That reflects "basic confidence" in the U.S. and its ability to bounce back from the global recession, he said.
The U.S. plans to rein in the deficit once the labor market recovers, Geithner said. In the short run, that means focusing on ways to "make sure that this economy is growing again," he said. The administration says the deficit will shrink over the next four years as more Americans find jobs and the economy accelerates.
"This is within our capacity to do," Geithner said.
The Obama administration has proposed additional tax cuts and small-business assistance in its bid to jumpstart the U.S. economy. Geithner and other officials have said it's too soon to start cutting spending because ending stimulus programs now could derail the economy.
Geithner said the risk of a "double dip" recession in the U.S. has declined, particularly given recent reports showing the economy grew at a 5.7 percent pace in the fourth quarter of last year.
"We have much, much lower risk of that today than at any time over the last 12 months or so," Geithner said. "We are beginning the process of healing."
That's what Tim said 18 months ago. If he were a physician predicting healing, we'd wonder about his medical education. Seriously wonder.